HR cannot be different from other functional departments like Finance, Marketing and Supply Chain that adeptly emphasize the financial benefits expected out of proposed investments.
HR departments often tend to struggle with getting approvals for investing in technological solutions such as Human Capital Management. Many HR professionals underestimate the need for making strong business cases for their investments. However, it is imperative that HR business proposals clearly outline the tangible benefits that HCM technologies can accrue to the company. Tangible is the key word here; in that sense HR cannot be any different from other functional departments like Finance, Marketing and Supply Chain that adeptly emphasize the bottom-line financial benefits expected out of proposed investments. Conversely, HR professionals typically project their mission as by and large qualitative, and hence fail to convince CFOs that tangible ROI exists.
It is widely understood that HCM technology adoption has a positive qualitative impact on the engagement of employees – especially the young, Gen Y employees. However, instead of just stating that technology would enhance employee experience, HR must articulate that bringing in the proposed technology will drive x amounts of productivity saving – which in turn would free up capacity for other critical projects. Below are 4 heads that benefit from HCM that HR can tangibly leverage in their proposals:
- Employer Brand: A company that makes its logistical processes easier through input automation and invests in providing technologically-enabled learning experiences like peer-to-peer learning enhances its brand value in the talent market. Attracting top talent is priority for companies these days and talented young candidates are attracted to companies with the right level of technology that helps them work efficiently, without having to deal with cumbersome processes to apply for leaves or to look up potential mentors. A recent CEB study showed that employers with low Employer Value Proposition pay an extra 21% premium to recruit top talent. Employers can therefore gain significant value out of investing in technological systems that meet the expectations of desirable candidates.
- Retention: It is twice or thrice as expensive to recruit a new employee, than to retain an existing, competent one. So if a company can retain, it can save a significant amount of money. Technology boosts employee engagement in several ways. When the employees feel satisfied that they are learning and optimizing their performance in the best possible way with access of modern tools which eliminate inefficient processes – they are less likely to want to migrate.
- Productivity: HCM technologies play an important role in identifying areas within processes that would improve productivity. Cumbersome HR processes replaced with 10 productive minutes for an employee means that each individual saves on time and unnecessary stress.
- User Experience: Better technology in Learning & Development, like peer-to-peer style, not only satisfies young employees – who find a flexible, bite sized approach more engaging – but also reduces costs of time-consuming, face-to-face trainings. The company benefits from both – cost cutting and better knowledge retention among employees.
It is vital for HR professionals to understand what makes a sound business proposal and build capability to write a good one and get approval for it. In that sense, HR cannot shy away or make exception to the key components of financial benefits and value addition.
This article is a part of the People Matters- Oracle Let's Talk Talent series. Click here to visit the Let's talk talent page to read more such articles.